Operators ignore SMS at their peril

The humble SMS will remain a significant source of revenues and traffic for mobile operators on a global basis until at least 2015, according to the latest forecasts from Informa Telecoms & Media. Global SMS revenues are forecast to rise to $136.9bn by 2015 from $105.5bn in 2010, as global SMS traffic increases from five trillion messages in 2010 to 8.7 trillion messages in 2015.

Although mobile operators are spending heavily on rollouts of LTE and other new technologies, leaving relatively little in the budget for messaging services, SMS should not be overlooked as a core service for mobile users, delivering in 2010, 80 per cent of data and messaging revenues.

In fact, argues Pamela Clark-Dickson, senior analyst at Informa, SMS will continue to be the most popular form of messaging for some time due to its low cost, universal access and interoperability across devices and mobile networks.

Although traditionally used by consumers, SMS is increasingly being used by government departments, banks and financial institutions, brands, retailers and transport providers for increasingly sophisticated purposes such as tickets, coupons, payments and loyalty programs. Its popularity in emerging markets as a banking and payment tool is also well documented.

Indeed, the types of services that are being delivered by SMS in emerging are playing a vital role in improving the economic and social well-being of mobile users and their families in these markets, said Clark-Dickson. Farmers can use SMS to receive weather reports, crop prices and information about fertilizers, and in so doing hopefully increase their crop yield and allow them to get the best possible price for their harvest. Meanwhile clinics can harness SMS to better manage their stocks of medication or to allow patients to check whether their medicines are fake, which will ultimately help reduce the spread of diseases such as malaria and HIV.

“The fact that SMS is the universal data communications channel on the mobile device is also a huge benefit for businesses and government departments in developed markets and, more recently, for social networks like Facebook and Twitter. By enabling SMS updates or alerts for their services, social networks, businesses and government departments can reach all mobile users, and not just the segment of users that owns a smartphone,“ said Clark-Dickson.

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One comment

  1. Avatar Martin Perminas 02/02/2011 @ 5:33 pm

    The latest forecast from Informa Telecoms & Media clearly highlights the importance and continued popularity of the humble text message. Many consumers have fully embraced text messaging as a form of daily communication due to its low cost and immediacy, however SMS has been largely lost on the business world – until now.

    Growing numbers of organisations are beginning to realise the power of a text message when communicating with customers, staff or even prospects. SMS is instant, cost-effective and can reach a large number of recipients in seconds – and more importantly, in today’s 24×7 society, 97.5%** of texts are read within five seconds. And it is for that reason that the humble SMS is starting to take off in the business world.

    A number of companies are already using one-way SMS to send reminders for appointment bookings, to confirm delivery times or distribute corporate announcements. But the critical challenge they all face is how to enable the recipient to respond in a way that closes the loop and completes the communication, as well as provide a full audit trail for the outgoing message to be paired with the end user’s response.

    The significant development making all of this possible is the introduction of unique two-way SMS technology that pairs an incoming text message with the original outgoing message. This two-way SMS technology can be embedded within an organisation’s CRM, ERP, appointment or back-office system, facilitating the sending of any number of messages to any number of recipients. It is in this way that a simple text message turns into an intelligent SMS application that business can exploit to automate workflow processes, receive instant responses and is far more effective at reaching the recipient compared to alternative mediums.

    Via two-way SMS technology, workflow processes can be addressed and enhanced allowing organisations to take advantage of improved customer satisfaction, efficient processes, reduced costs and revenue stimulation – something that is crucial to many businesses in today’s economy.

    Martin Perminas

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